I just found these super cute illustrated fold out "how to knit" cards from Knitters Universe. They are available to volunteer knitting teachers for free. They come in bundles of 12 and all you need to pay is the cost of shipping ($2.90/bundle). I'm not sure how clear the illustrations are, but boy are they cute.
We need these for crochet!
While you're looking at the cards, check out the Knitters Kids section. There are simple ideas and projects on how to teach kids in group settings.